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0 points100011_1000013y ago0 comments

OK, that is true in a way, I do think it depends on when you are thinking about retirement age, your future plans post-retirement, your family situation and how the market is doing in general.

I have 4 kids, in Silicon Valley I would need $1.2M to buy a 4-bedroom house (2018 average). Where I live, I own two 5-bedroom houses for a total of $240K. So now I have secondary income and my taxes are much lower than the $1.2M house taxes. This thing kind of cascades let's say you put $200K down for your $1.2M house, so $1M loan also means your 4% interest will be a lot more money than my 4% interest rate. Your school taxes, and property taxes would be much more $ as well.

All that money has to come from somewhere. Does it mean your 401K % contribution is lower? Does it mean that if you do retire with twice as much money in retirement you will be spending all the profits paying your taxes? Maybe, maybe not.

I think that's kind of impossible to predict clearly what's more beneficial. For me I rather have my houses fully paid by the time I retire, I'm trending to have paid both of them off in about 8-10 years. I'm putting 13% to 401K, 6% in IRA and living a comfortable life. Would I have 4 kids if I living in NYC or the Valley? Definitely not.

I'm not trying to argue that my way is the best way. Just that it's just "a way", an alternative for someone that is tired of working in FAANG and wants something else.

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boring_twenties3y ago

Yeah, but a single person with no kids making $500k in NYC or SF can save $150k+ per year even after all expenses. Then, instead of spending 8-10 years paying off that $240k house in the midwest, they can just buy it for cash and have plenty left over.

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0 points100011_1000013y ago0 comments

OK, that is true in a way, I do think it depends on when you are thinking about retirement age, your future plans post-retirement, your family situation and how the market is doing in general.

I'm not trying to argue that my way is the best way. Just that it's just "a way", an alternative for someone that is tired of working in FAANG and wants something else.